Is your cheque in the post?

By STEPHEN WOMACK
Updated:

 

Sending money to friends or relatives overseas is a familiar task for many families at Christmas. And as the millennium approaches, many parents with children travelling on a gap year may also want to bolster the finances of their globetrotting offspring to help them celebrate in style.

There are many ways to send cash overseas. Picking the right one will depend on how quickly money needs to get to its destination, what senders are willing to pay and how much risk they are prepared to take.

Thousands still send cash by post despite the risk of theft or loss. Those who are determined to stuff envelopes with cash should consider using International Registered Post. This service is available for sending to more than 140 countries and allows senders to insure the contents.

There is a choice of two levels of insurance, paid at the same time as postage. Up to £500 costs £3.15 and up to £2,200 costs £4.20.

Popping a cheque in the post is certainly safer than sending cash, but it is likely to be a costly option for whoever receives the gift.

Cashing UK bank cheques overseas will incur expensive local bank charges, and clearing a cheque could take between two and three weeks. A better option is an international banker's draft. Think of this as an international cheque made out to the recipient either in sterling or a local currency. It can be cashed for modest fees at many overseas banks.

Drafts can be bought over the counter at High Street banks, though smaller branches may need notice. Charges vary. HSBC is good value for drafts of up to £100, charging £7. But this jumps to a £12 minimum for bigger sums. Lloyds TSB charges a flat rate £10.

Once a draft is purchased, it still has to be posted in time for Christmas. Airmail letters to addresses outside Europe should be in the post by December 6, while those for European destinations have to go by December 13.

Electronic money transfer services will ensure that money gets to its destination more quickly. Co-operative bank runs one of the cheapest, Tipanet, and users do not have to be Co-op customers.

This covers just five European countries plus the US and Canada. It charges a flat £7, but money will be in their account or waiting at a bank in three to six days and there are no charges at the other end.

HSBC has a similar system called Worldpay. This costs £9 and is available for 20 nations including Australia and South Africa. But as with Tipanet, the recipient must have a bank account.

More flexible systems are offered by money-transfer specialists such as MoneyGram and Western Union. MoneyGram, available through 1,900 post offices and 1,000 Thomas Cook outlets, can get money to more than 100 nations within minutes.

Neither sender nor receiver needs a bank account and all fees are paid by the sender. Up to £100 costs £12, and £301 to £400 costs £27.

Western Union runs a similar service, but it also allows transfers by credit card over the phone.

• Registered Post 0345 740740; Western Union 0800 833833; MoneyGram 0800 018 0104.

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